Cross section of stakeholders of the have described as remarkable, Nestlé’s Nigeria Plc, 2016 audited financial statement, saying that it beats expectations, irrespective of macro-economic challenges. A stock broker who spoke to Daily Times on condition of anonymity said that release of the result triggered positive market sentiment and reactions as mandates for the stock rose ‘ Though the result has its weak ends, but it was better than expected” the broker said.
Nestle Nigeria Plc result for the period ended December 31 2016, released by the Nigerian Stock Exchange (NSE) on Thursday showed a boost in revenue,and final dividend of N10 per share representing a dividend yield of 1.8 per cent based on Wednesday’s equity piece. The company’s result showed that revenue grew to N181.91 billion, from N151.27 billion posted in the 2015 financial year. Gross profit of N75.32 billion was recorded, against N67.35 in 2015, results from operating activities N38.21 billion, from N33.75 billion, while profit for the period closed the accounting period at N7.92 billion, against N23.74 billion in 2015 financial year.
Cost of sales in 2016 was N106.58 million, against N83.93 million in the corresponding year, while marketing and distribution expenses rose slightly to N28.78 billion from N25.90 billion in 2015. Finance income grew to N4.2 billion, against N443.805 million in 2015. Net Finance cost was N16.66 billion from N4.42 billion recorded in 2015. The results further showed that revenue grew by 20 per cent, in spite of the operating environment and low consumer demands for consumer goods based on tight liquidity and inflation. The company in a statement said “this is a confirmation that our brands continue to enjoy strong patronage as they enable our loyal consumers to live happier and healthier.
According to the company, notwithstanding the increase in the cost of sales, and operating profit, due to rising input cost and currency devaluation, operating profit increased by 13 per cent, made possible through internal cost savings initiatives, operating efficiencies and price management. Nestle’ Nigeria explained that “The company’s profit tax was negatively impacted both buy revaluation of foreign loans resulting from revaluation of the Naira and higher income tax provisions following expiration of pioneer status”.
The board and management disclosed in a statement that they remain optimistic about the long term potential of the business irrespective of the current challenging macroeconomic environment They assured that the company will continue to boost investments in the key brand sand route to market activities and will proactively manage input cost pressure.